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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 
 FORM 20-F
 
 o
    
    REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
 OR
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For
the fiscal year ended: December 31, 2010
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 OR
 o
    
    SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Date of event requiring this shell company report
 For the transition period from               to
 Commission file number: 001-34958
 
 CHINA XINIYA FASHION LIMITED
 (Exact name of Registrant as specified in its charter)
 
 Not Applicable
    
    Cayman Islands(Translation of Registrants name into English)
    
    (Jurisdiction of Incorporation or Organization)
 Xiniya Industry Mansion, Xintang Development Area,
Jinjiang City, Fujian Province 362200
Peoples Republic of China
 Mr. Chee Jiong Ng
Chief Financial Officer
Tel: (86-595) 6532-3882
E-mail: ngcheejiong@xiniya.com
Fax: (86-595) 8300-5707
Xiniya Industry Building, Xintang Development Area,
Jinjiang City, Fujian Province 362200
Peoples Republic of China
  Title of each class
    
    Exchange on which registeredOrdinary shares, par value US$0.00005 per share
American depositary shares, each representing
four ordinary shares
    
    New York Stock Exchange*
New York Stock Exchange
 
 *
    
    Not for trading but only in connection with the
listing on New York Stock Exchange of the American depositary
shares. None
 None
 232,000,000 Ordinary Shares, par value
US$0.00005 per share
  o þ
  o þ
  þ o
  o o
  Large accelerated filer oAccelerated filer oNon-accelerated filer þ  U.S. GAAP o
    
    International Financial Reporting Standards as issued
by the International Accounting Standards Board þ
    
    Other o
  o o
  o þ
   o o




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##### 



TABLE OF CONTENTS
 CONVENTIONS THAT APPLY TO THIS ANNUAL REPORT
    
    
    1FORWARD-LOOKING STATEMENTS
    
    
    2PART IItem 1.
    
    Identity of Directors, Senior Management and Advisers
    
    
    3Item 2.
    
    Offer Statistics and Expected Timetable
    
    
    3Item 3.
    
    Key Information
    
    
    3Item 4.
    
    Information on the Company
    
    
    25Item 4A.
    
    Unresolved Staff Comments
    
    
    46Item 5.
    
    Operating and Financial Review and Prospects
    
    
    46Item 6.
    
    Directors, Senior Management and Employees
    
    
    64Item 7.
    
    Major Shareholders and Related Party Transactions
    
    
    71Item 8.
    
    Financial Information
    
    
    72Item 9.
    
    The Offer and Listing
    
    
    73Item 10.
    
    Additional Information
    
    
    73Item 11.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    79Item 12.
    
    Description of Securities Other than Equity Securities
    
    
    80PART IIItem 13.
    
    Defaults, Dividend Arrearages and Delinquencies
    
    
    82Item 14.
    
    Material Modifications to the Rights of Security Holders and Use of Proceeds
    
    
    82Item 15.
    
    Controls and Procedures
    
    
    82Item 16A.
    
    Audit Committee Financial Expert
    
    
    83Item 16B.
    
    Code of Ethics
    
    
    83Item 16C.
    
    Principal Accountant Fees and Services
    
    
    83Item 16D.
    
    Exemptions from The Listing Standards for Audit Committees
    
    
    84Item 16E.
    
    Purchases of Equity Securities by The Issuer and Affiliated Purchasers
    
    
    84Item 16F.
    
    Change in Registrants Certifying Accountant
    
    
    84Item 16G.
    
    Corporate Governance
    
    
    84PART IIIItem 17.
    
    Financial Statements
    
    
    85Item 18.
    
    Financial Statements
    
    
    85Item 19.
    
    Exhibits
    
    
    85EX-12.1 Certification by the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley ActEX-12.2 Certification by the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley ActEX-13.1 Certification by the Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley ActEX-13.2 Certification by the Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act




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CONVENTIONS THAT APPLY TO THIS ANNUAL REPORT
  
    
    ADRs are to the American depositary receipts that evidence our ADSs;
    
    ADSs are to our American depositary shares, each of which represents four ordinary shares, par value
$0.00005 per share;
    
    China or the PRC are to the Peoples Republic of China, excluding, for the purpose of this annual report
only, Taiwan and the special administrative regions of Hong Kong and Macau;
    
    China Xiniya, we, us, our company and our refer to China Xiniya Fashion Limited, its predecessor and
its consolidated subsidiaries;
    
    first-tier cities are to Beijing, Shanghai, Guangzhou and Shenzhen;
    
    fourth-tier cities are to county-level and other township-level cities in the PRC;
    
    Fujian Xiniya are to Fujian Xiniya Garments and Weaving Co., Ltd., our wholly owned subsidiary in the PRC;
    
    HK$ are to the legal currency of Hong Kong;
    
    Hong Kong are to the Hong Kong Special Administrative Region of the PRC;
    
    Jinjiang Xiniya are to Jinjiang Xiniya Garments and Weaving Co., Ltd., one of our related parties in the PRC;
    
    RMB and Renminbi are to the legal currency of China;
    
    second- and lower-tier cities are to second-tier cities, third-tier cities and fourth-tier cities;
    
    second-tier cities are to provincial capital cities and the capital cities of the autonomous regions in the
PRC, excluding first-tier cities;
    
    shares or ordinary shares are to our ordinary shares, par value $0.00005 per share;
    
    Shishi Xiniya are to Shishi Xiniya Garments and Weaving Co., Ltd., our predecessor, one of our related
parties in the PRC from October 2005 to January 2009 and an independent third party after January 2009;
    
    third-tier cities are to prefecture-level cities in the PRC, excluding first- and second-tier cities;
    
    U.S. dollars and $ are to the legal currency of the United States; and
    
    Xiniya Hong Kong are to Xiniya Holdings Limited, our wholly owned subsidiary in Hong Kong, which owns 100%
equity interest in Fujian Xiniya.
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FORWARD-LOOKING STATEMENTS
   
    
    our anticipated growth strategies;
    
    our future business development, financial condition and results of operations;
    
    market acceptance of our products and product candidates;
    
    our ability to manage the expansion of our operations;
    
    our ability to successfully develop and improve our products;
    
    our ability to effectively protect our intellectual property and trade secrets and not
infringe on the intellectual property and trade secrets of others;
    
    the sufficiency of our existing and future intellectual property right protections;
    
    our ability to obtain regulatory approval for our operations;
    
    changes in the mens business casual apparel industry in China;
    
    competition from other manufacturers of mens business casual apparel products;
    
    the expected growth for the mens business casual apparel industry in China; and
    
    fluctuations in general economic and business conditions in China.
  2




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PART I
 
 ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS
  
 ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
  
 ITEM 3. KEY INFORMATION
 A. Selected Financial Data
  For the Year Ended December 31,2006
    
    2007
    
    2008
    
    2009
    
    2010RMB
    
    RMB
    
    RMB
    
    RMB
    
    RMB
    
    $(amounts in thousands, except for per share data)Selected Statement of ComprehensiveIncome DataRevenueBusiness casual
    
    
    148,605
    
    
    
    222,746
    
    
    
    411,576
    
    
    
    622,538
    
    
    
    804,255
    
    
    
    121,857Business formal
    
    
    12,674
    
    
    
    28,328
    
    
    
    66,511
    
    
    
    42,567
    
    
    
    84,611
    
    
    
    12,820Accessories
    
    
    
    
    
    
    824
    
    
    
    1,624
    
    
    
    6,970
    
    
    
    10,386
    
    
    
    1,574Total revenues
    
    
    161,279
    
    
    
    251,898
    
    
    
    479,711
    
    
    
    672,075
    
    
    
    899,252
    
    
    
    136,251Operating costs and expensesCost of sales
    
    
    (108,757
    )
    
    
    (169,991
    )
    
    
    (313,521
    )
    
    
    (438,773
    )
    
    
    (589,233
    )
    
    
    (89,278
    )Selling and distribution expenses
    
    
    (6,834
    )
    
    
    (9,568
    )
    
    
    (15,925
    )
    
    
    (8,744
    )
    
    
    (11,999
    )
    
    
    (1,818
    )Administrative expenses
    
    
    (2,848
    )
    
    
    (3,412
    )
    
    
    (6,813
    )
    
    
    (2,898
    )
    
    
    (10,108
    )
    
    
    (1,532
    )Total operating costs and expenses
    
    
    (118,439
    )
    
    
    (182,971
    )
    
    
    (336,259
    )
    
    
    (450,415
    )
    
    
    (611,340
    )
    
    
    92,628Operating Income
    
    
    42,840
    
    
    
    68,927
    
    
    
    143,452
    
    
    
    221,660
    
    
    
    287,912
    
    
    
    43,623Interest income
    
    
    210
    
    
    
    459
    
    
    
    677
    
    
    
    793
    
    
    
    847
    
    
    
    128Income Before Tax
    
    
    43,050
    
    
    
    69,386
    
    
    
    144,129
    
    
    
    222,453
    
    
    
    288,759
    
    
    
    43,751Income tax expense
    
    
    
    
    
    
    
    
    
    
    (18,112
    )
    
    
    (28,109
    )
    
    
    (36,413
    )
    
    
    (5,517
    )Net Income
    
    
    43,050
    
    
    
    69,386
    
    
    
    126,017
    
    
    
    194,344
    
    
    
    252,346
    
    
    
    38,234Earnings per ordinary share, basic and
diluted (1)
    
    
    0.22
    
    
    
    0.35
    
    
    
    0.63
    
    
    
    0.97
    
    
    
    1.24
    
    
    
    0.19Earnings per ADS(2)
    
    
    0.88
    
    
    
    1.39
    
    
    
    2.52
    
    
    
    3.89
    
    
    
    4.96
    
    
    
    0.75Dividends declared per share (3)
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/A
 
 (1)
    
    Earnings per share is calculated by dividing net income attributable to the equity
holders of our company by the weighted average number of ordinary shares outstanding during
each of the periods reported. The weighted average ordinary shares outstanding during the
respective periods have been retrospectively adjusted to reflect the July 2010 capitalization
that resulted in the issuance of 10,000 ordinary shares of China Xiniya Fashion Limited, the
share split effected on November 4, 2010.(2)
    
    Each ADS represents four ordinary shares. Earnings per ADS is calculated by
dividing net income attributable to the equity holders of our company by the weighted average
number of ordinary shares outstanding during each of the periods reported and multiplying by
four. The weighted average ordinary shares outstanding during the respective periods have
been retrospectively adjusted to reflect the July 2010 capitalization that resulted in the
issuance of 10,000 ordinary shares of China Xiniya Fashion Limited, the share split effected
on November 4, 2010. 3




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(3)
    
    Dividends of RMB38.6 million ($5.0 million), RMB62.3 million ($8.6 million) and
RMB113.3 million ($16.6 million), which were derived from profits for the years ended
December 31, 2006, 2007 and 2008, respectively, were paid on January 19, 2007, January 21,
2008 and December 28, 2009, respectively. These dividends were not calculated or paid on a
per share basis. Therefore, the rate of dividend and the number of shares ranking for
dividends are not presented as such information is not meaningful. For the amount of
dividends paid, the translation of Renminbi into U.S. dollars has been made at the rates in
effect on the respective payment dates. As of December 31,2006
    
    2007
    
    2008
    
    2009
    
    2010RMB
    
    RMB
    
    RMB
    
    RMB
    
    RMB
    
    $(amounts in thousands)Selected Statement of Financial
Position DataCash and cash equivalents
    
    
    64,825
    
    
    
    100,056
    
    
    
    156,639
    
    
    
    142,302
    
    
    
    862,797
    
    
    
    130,727Total current assets
    
    
    66,830
    
    
    
    103,732
    
    
    
    217,104
    
    
    
    283,714
    
    
    
    1,094,865
    
    
    
    165,889Total non-current assets
    
    
    4,220
    
    
    
    3,811
    
    
    
    3,294
    
    
    
    2,776
    
    
    
    6,660
    
    
    
    1,009Total assets
    
    
    71,050
    
    
    
    107,543
    
    
    
    220,398
    
    
    
    286,490
    
    
    
    1,101,525
    
    
    
    166,898Total current liabilities
    
    
    63,530
    
    
    
    86,158
    
    
    
    72,996
    
    
    
    58,083
    
    
    
    98,693
    
    
    
    14,953Net assets
    
    
    7,520
    
    
    
    21,385
    
    
    
    147,402
    
    
    
    228,407
    
    
    
    1,002,832
    
    
    
    151,945Total shareholders equity
    
    
    7,520
    
    
    
    21,385
    
    
    
    147,402
    
    
    
    228,407
    
    
    
    1,002,832
    
    
    
    151,945Total liabilities and equity
    
    
    71,050
    
    
    
    107,543
    
    
    
    220,398
    
    
    
    286,490
    
    
    
    1,101,525
    
    
    
    166,898
 Exchange Rate Information
   Certified Exchange Rate(1)Period End
    
    Average(2)
    
    Low
    
    High2006
    
    
    7.8041
    
    
    
    7.9723
    
    
    
    7.8041
    
    
    
    8.07022007
    
    
    7.2946
    
    
    
    7.5806
    
    
    
    7.2946
    
    
    
    7.81272008
    
    
    6.8225
    
    
    
    6.9477
    
    
    
    6.7800
    
    
    
    7.29462009
    
    
    6.8259
    
    
    
    6.8307
    
    
    
    6.8176
    
    
    
    6.84702010
    
    
    6.6000
    
    
    
    6.7696
    
    
    
    6.6000
    
    
    
    6.83302010September
    
    
    6.6905
    
    
    
    6.7396
    
    
    
    6.6869
    
    
    
    6.8102October
    
    
    6.6705
    
    
    
    6.6675
    
    
    
    6.6397
    
    
    
    6.6912November
    
    
    6.6670
    
    
    
    6.6538
    
    
    
    6.6330
    
    
    
    6.6892December
    
    
    6.6000
    
    
    
    6.6497
    
    
    
    6.6000
    
    
    
    6.67452011January
    
    
    6.6017
    
    
    
    6.5964
    
    
    
    6.5809
    
    
    
    6.6364February
    
    
    6.5713
    
    
    
    6.5761
    
    
    
    6.5520
    
    
    
    6.5965March
(through March 18)
    
    
    6.5689
    
    
    
    6.5690
    
    
    
    6.5540
    
    
    
    6.5743
 
 (1)
    
    For all periods prior to January 1, 2009, the exchange rate refers to the noon buying rate
as reported by the Federal Reserve Bank of New York. For periods beginning on or after
January 1, 2009, the exchange rate refers to the exchange rate as set forth in the H.10
statistical release of the Federal Reserve Board.(2)
    
    Annual averages are calculated from month-end rates. Monthly averages are calculated using
the average of the daily rates during the relevant period. 4




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B. Capitalization and Indebtedness
  C. Reasons for the Offer and Use of Proceeds
  D. Risk Factors
 We rely heavily on our Xiniya brand. Failure to successfully maintain or promote our brand may
adversely affect our results of operations.
  We rely on distributors to distribute our products to end consumers, to expand our authorized
retail network and to achieve our growth target. The loss of, or significant decrease in, sales to
our distributors could have a material adverse effect on our financial condition and results of
operations.
   
    
    we typically enter into agreements with each of our distributors for a one-year term and
renew the agreements with them before the expiration of these agreements, and the agreements
we have with our existing distributors may not be renewed on the same or similar terms, or at
all;
    
    our existing distributors may not continue to place orders with us at historical levels or
at all, and if any of our major distributors substantially reduces its volume of purchases
from us or ceases its business relationship with us, our financial condition and results of
operations may be materially adversely affected;
    
    most of the distributors of our products are given exclusivity over their respective
regions (usually an entire province or municipality), and if any of them terminates or does
not renew its distributorship agreement with us, we may not be able to replace it with a new
distributor in a timely manner, or the
replacement distributor may not be able to manage the same network of retailers or a network
of retailers of similar scale; if we are unable to locate a replacement distributor, we would
lose sales generated from the retail outlets in the entire region and our financial condition
and results of operations could be materially adversely affected; and
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
    
    if any of our distributors fails to adhere to its contractual obligation to distribute our
products on an exclusive basis, our brand image and sales could be materially adversely
affected.
  
    
    availability of suitable locations;
    
    availability of financing to us, our distributors or the department store chains or
authorized retailers supervised by our distributors;
    
    complexity of the process for applying for all necessary licenses and permits for the new
stores;
    
    hiring and training of qualified sales personnel;
    
    consumers acceptance of our products at specific areas; and
    
    implementation of our sales and marketing policies at the new stores.
  A distributors failure to distribute our products to the authorized retail network under its
jurisdiction could materially adversely affect the business of the authorized retailers of an
entire geographic area, as well as our reputation, brand image and results of operations.
   Some of our distributors and the department store chains that sell our products have, in the
past, failed to pay us for their purchases in a timely manner. Such failure to make timely payment
could materially adversely affect our financial condition and results of operations.
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Consumer sales of our products are conducted by distributors, authorized retailers and
department store chains over whom we have limited control.
  Our plan to manage new flagship stores may not succeed, and there may be competition among
our company, our distributors, authorized retailers and department store chains.
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We operate in a very competitive market and the intense competition we face may result in a
decline in our market share and lower profit margins.
  We may not be able to accurately track the inventory levels at our distributors, retailers or
department store concessions.
   We are heavily dependent on certain of our key personnel and design and technical personnel.
Our inability to attract, retain and motivate qualified personnel could adversely affect our
business and growth prospects.
  Our operations could be materially adversely affected if we fail to effectively manage our
relationships with, or lose the services of, our contract manufacturers.
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We rely on a number of suppliers for certain raw materials. Unfavorable fluctuations in the
price, availability and quality of raw materials could cause production delays and increase
production costs.
   Our sales, results of operations and reputation could be materially adversely affected if we
or our contract manufacturers fail to prevent interruption of our manufacturing operations, or
fail to deliver products on schedule and at the level of quality expected by our distributors,
department store chains, retailers and consumers.
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We may not be able to anticipate and respond in a timely manner to rapid changes in consumers
tastes and preferences.
  Failure to continue to engage Jacky Cheung as our brand spokesperson could harm our business.
   We may fail to execute our growth strategy or maintain our growth rate.
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Our sales are subject to seasonality and weather conditions, which could cause our results of
operations to fluctuate.
  Any material disruption of our operations or the operations of our suppliers, distributors
and/or retailers from natural disasters, war, political unrest and epidemics could materially
adversely affect our results of operations.
  We may not be able to adequately protect our intellectual property rights, which could harm
our brand and our business.
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The legitimate use of trademarks or brands that are similar to our trademarks or brands by
other parties may have a negative impact on the goodwill, value and image of our products.
  Our business could be adversely affected by claims by third parties for possible infringement
of their intellectual property rights.
  We may need additional capital to fund the growth of our business, which may not be available
on terms acceptable to us or at all, and which, if available, could dilute your interest in our
company.
   
    
    investors perception of, and demand for, our securities;
    
    prevailing conditions of the capital markets in which we seek to raise funds;
    
    our future results of operations, financial condition and cash flows;
    
    PRC governmental policies relating to foreign exchange; and
    
    economic, political and other conditions in China.
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Our operations and financial performance may be adversely affected by labor shortages, an
increase in labor costs, any change to the PRC labor laws and regulations or by labor disputes.
    We are exposed to environmental liability. Changes in existing laws and regulations or
additional or stricter laws and regulations on environmental protection in China may cause us to
incur additional capital expenditures.
   We may be exposed to product liability, property damage or personal injury claims, which may
adversely affect our reputation and business.
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We have a limited operating history and you should not rely on our historical financial data
as an indicator of our future financial performance.
  Our independent registered public accounting firm has identified material weaknesses in our
internal control over financial reporting. If we are unable to correct these weaknesses, our
ability to accurately and timely report our financial results or prevent fraud may be adversely
affected, and investor confidence and the market price of our ADSs may be adversely impacted.
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If we grant employee stock options or other share-based compensation in the future, our net income
could be materially adversely affected.
  Risks Relating to Conducting Business in the PRC
  Fluctuations in consumer spending caused by changes in macroeconomic conditions in the PRC
may significantly affect our business and financial performance.
  Our business may be materially adversely impacted by the recent global financial crisis and
economic downturn.
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
    
    we were faced with severe competition during the global financial crisis and economic
downturn, due to the decrease of mens apparel exports from China, which has caused more
competitors to sell into the PRC market their products that they had previously planned to
export;
    
    an economic slowdown or recession, or even the risk of potential economic slowdown or
recession, may cause our distributors to delay, defer or cancel their purchases from us,
including previously agreed purchase plans;
    
    under difficult economic conditions, consumers may seek to reduce discretionary spending
by foregoing purchases of our products; and
    
    financing and other sources of liquidity may not be available on reasonable terms or at
all.
  Changes in the laws, regulations and policies adopted by the PRC government, including in relation
to the environment, labor and taxation, may adversely affect our business, growth strategies,
operating results and financial condition.
    
    
    political instability or changes in social conditions in the PRC;
    
    changes in laws, regulations and administrative directives;
    
    measures which may be introduced to control inflation or deflation;
    
    changes in the rate or method of taxation; and
    
    reduction in tariff protection and other import and export restrictions.These factors are affected by a number of variables which are beyond our control.
 The approval of the China Securities Regulatory Commission, or the CSRC, may be required in
connection with our initial public offering that was completed in November 2010; the failure to
obtain this approval, if required, could have a material adverse effect on our business, operating
results and reputation as well as the trading price of our ADSs.
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The M&A Rules set forth complex procedures for acquisitions conducted by foreign investors, which
could make it more difficult to pursue growth through acquisitions.
  PRC regulations relating to offshore investment activities by PRC residents and PRC citizens may
increase the administrative burden we face and may subject our PRC resident beneficial owners or
employees or PRC citizen stock option holders to personal liabilities, limit our subsidiarys
abilities to increase its registered capital or distribute profits to us, limit our ability to
inject capital into our PRC subsidiary, or may otherwise expose us to liability under PRC law.
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Restrictions on foreign exchange under PRC laws may limit our ability to convert cash derived
from our operating activities into foreign currencies and may materially and adversely affect the
value of your investment.
  We are a holding company that heavily relies on dividend payments from our subsidiary for funding.
  Fluctuations in foreign exchange rates may adversely affect our financial condition and
results of operations.
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Any change in our tax treatment, including an unfavorable change in preferential corporate
tax rates in the PRC, may have a negative impact on our operating results.
    Our future worldwide income may be subject to PRC income tax.
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Dividends from Fujian Xiniya and dividends on our ADSs or ordinary shares and gains on the
sales of our ADSs or ordinary shares may be subject to PRC withholding taxes.
   We may be requested to make up any unpaid contribution to the social security insurance
schemes and we and our responsible officers may be subject to a late charge and other penalties.
   20




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##### Table of Contents



The PRC legal system has inherent uncertainties regarding the interpretation and enforcement of
PRC laws and regulations which could limit the legal protections available to investors.
  Any recurrence of severe acute respiratory syndrome, or SARS, pandemic avian influenza or an
increase in the severity of H1N1 influenza or any other widespread public health problem could
materially adversely affect our business and results of operations.
  Risks Related to Our Ordinary Shares and ADSs
 The trading prices of our ADSs are likely to be volatile, which could result in substantial losses to investors.
  21




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##### Table of Contents




    
    variations in our revenues, earnings and cash flow;
    
    announcements of new investments, acquisitions, strategic partnerships, or joint ventures;
    
    announcements of new services and expansions by us or our competitors;
    
    changes in financial estimates by securities analysts;
    
    additions or departures of key personnel;
    
    release of lock-up or other transfer restrictions on our outstanding equity securities or
sales of additional equity securities;
    
    potential litigation or regulatory investigations; and
    
    fluctuations in market prices for our services.
  Substantial future sales or perceived sales of our ADSs or ordinary shares in the public market
could cause the price of our ADSs to decline.
  Our articles of association contain anti-takeover provisions that could have a material adverse
effect on the rights of holders of our ordinary shares and ADSs.
  You may face difficulties in protecting your interests, and your ability to protect your rights
through the U.S. federal courts may be limited, because we are incorporated under Cayman Islands
law.
  22




---



##### Table of Contents




    
    recognize or enforce judgments of courts of the United States obtained against us
based on certain civil liability provisions of U.S. securities laws; and
    
    entertain original actions brought against us predicated upon certain civil
liability provisions of U.S. securities laws.
   Certain judgments obtained against us by our shareholders may not be enforceable.
  The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you
may not be able to exercise your right to vote your ordinary shares.
  The depositary for our ADSs will give us a discretionary proxy to vote our ordinary shares
underlying your
 23




---



##### Table of Contents



ADSs if you do not vote at shareholders meetings, except in limited circumstances, which
could adversely affect your interests.
  
    
    we have instructed the depositary that we do not wish a discretionary proxy to be given;
    
    we have informed the depositary that there is substantial opposition as to a matter to be
voted on at the meeting; or
    
    a matter to be voted on at the meeting would have a material adverse impact on shareholders.
  You may not receive dividends or other distributions on our ordinary shares and you may not
receive any value for them, if it is illegal or impractical to make them available to you.
  You may not be able to participate in rights offerings and may experience dilution of your
holdings.
  You may be subject to limitations on transfer of your ADSs.
  24




---



##### Table of Contents



Your right to participate in any future rights offerings may be limited, which may cause dilution
to your holdings and you may not receive distributions with respect to the underlying ordinary
shares if it is impractical to make them available to you.
   We may be or become classified as a passive foreign investment company, which could result in
adverse U.S. federal income tax consequences to U.S. holders of our ADSs or ordinary shares.
  
 ITEM 4.
    
    INFORMATION ON THE COMPANY
 A. History and Development of the Company
  25




---



##### Table of Contents



(1)
    
    Wholly owned by Mr. Qiming Xu, our founder, chairman and chief executive officer.
  The information
contained on our website does not constitute a part of this annual report.
 B. Business Overview
  26




---



##### Table of Contents



27




---



##### Table of Contents



Our Brand and Products
 Our Brand
   Our Products
  
 
 
  Design and Merchandising
  28




---



##### Table of Contents



Production
   Inventory Management
 29




---



##### Table of Contents



Quality Control
    Our Distribution Network
    30
    Table of Contents  31
    Table of Contents  For the Year Ended December 31,2008
    
    2009
    
    2010% of
    
    
    
    
    
    % of
    
    
    
    
    
    
    
    
    
    % ofAmount
    
    Revenues
    
    Amount
    
    Revenues
    
    Amount
    
    RevenuesRMB
    
    
    
    
    
    RMB
    
    
    
    
    
    RMB
    
    $(amounts in thousands, except for percentages)Eastern region (1)
    
    
    153,348
    
    
    
    32.0
    %
    
    
    211,348
    
    
    
    31.4
    %
    
    
    280,564
    
    
    
    42,510
    
    
    
    31.2
    %Central and southern region (2)
    
    
    141,221
    
    
    
    29.4
    %
    
    
    178,924
    
    
    
    26.6
    %
    
    
    252,592
    
    
    
    38,272
    
    
    
    28.1
    %Southwestern region (3)
    
    
    68,325
    
    
    
    14.2
    %
    
    
    100,468
    
    
    
    15.0
    %
    
    
    127,674
    
    
    
    19,345
    
    
    
    14.2
    %Northeastern region (4)
    
    
    54,362
    
    
    
    11.3
    %
    
    
    80,430
    
    
    
    12.0
    %
    
    
    101,367
    
    
    
    15,359
    
    
    
    11.3
    %Northwestern region (5)
    
    
    40,948
    
    
    
    8.5
    %
    
    
    64,282
    
    
    
    9.6
    %
    
    
    81,151
    
    
    
    12,295
    
    
    
    9.0
    %Northern region (6)
    
    
    21,507
    
    
    
    4.6
    %
    
    
    36,623
    
    
    
    5.4
    %
    
    
    55,904
    
    
    
    8,470
    
    
    
    6.2
    %479,711
    
    
    
    100.0
    %
    
    
    672,075
    
    
    
    100.0
    %
    
    
    899,252
    
    
    
    136,251
    
    
    
    100.0
    %
 
 (1)
    
    The eastern region includes Anhui Province, Fujian Province, Jiangsu Province, Jiangxi Province, Shandong Province, Zhejiang Province and Shanghai.(2)
    
    The central and southern region includes Guangdong Province, Hainan Province, Henan Province, Hubei Province, Hunan Province and Guangxi Zhuang Autonomous Region.(3)
    
    The southwestern region includes Guizhou Province, Sichuan Province, Yunnan Province, Tibet Autonomous Region and Chongqing.(4)
    
    The northeastern region includes Heilongjiang Province, Jilin Province and Liaoning Province.(5)
    
    The northwestern region includes Gansu Province, Shaanxi Province, Ningxia Autonomous Region and Xinjiang Uygur Autonomous Region.(6)
    
    The northern region includes Hebei Province, Shanxi Province, Inner Mongolian Autonomous Region, Beijing and Tianjin.  Distributors
  32
    Table of Contents  As of December 31,2008
    
    2009
    
    2010Eastern region (1)
    
    
    7
    
    
    
    7
    
    
    
    7Central and southern region (2)
    
    
    5
    
    
    
    5
    
    
    
    5Southwestern region (3)
    
    
    4
    
    
    
    4
    
    
    
    4Northern region (4)
    
    
    4
    
    
    
    4
    
    
    
    4Northeastern region (5)
    
    
    2
    
    
    
    2
    
    
    
    3Northwestern region (6)
    
    
    3
    
    
    
    3
    
    
    
    3Total:
    
    
    25
    
    
    
    25
    
    
    
    26
 
 (1)
    
    The eastern region includes Anhui Province, Fujian Province, Jiangsu Province, Jiangxi Province, Shandong Province,
Zhejiang Province and Shanghai.(2)
    
    The central and southern region includes Guangdong Province, Hainan Province, Henan Province, Hubei Province, Hunan
Province and Guangxi Zhuang Autonomous Region.(3)
    
    The southwestern region includes Guizhou Province, Sichuan Province, Yunnan Province, Tibet Autonomous Region and Chongqing.(4)
    
    The northern region includes Hebei Province, Shanxi Province, Inner Mongolian Autonomous Region, Beijing and Tianjin.(5)
    
    The northeastern region includes Heilongjiang Province, Jilin Province and Liaoning Province.(6)
    
    The northwestern region includes Gansu Province, Shaanxi Province, Ningxia Autonomous Region and Xinjiang Uygur Autonomous
Region.    33
    Table of Contents  As of December 31,2010As of December 31,
    
    
    
    
    
    Managed by2008
    
    2009
    
    
    
    
    
    DepartmentManaged by
    
    
    
    
    
    Managed by
    
    
    
    
    
    Store Chains
    
    Managed byManaged by
    
    Authorized
    
    Managed by
    
    Authorized
    
    Managed by
    
    Supervised by
    
    AuthorizedDistributors
    
    Retailers
    
    Distributors
    
    Retailers
    
    Distributors
    
    Distributors (10)
    
    RetailersAnhui (1)
    
    
    
    
    
    
    8
    
    
    
    
    
    
    
    8
    
    
    
    
    
    
    
    18
    
    
    
    10Beijing
    
    
    1
    
    
    
    16
    
    
    
    1
    
    
    
    16
    
    
    
    1
    
    
    
    
    
    
    
    17Chongqing
    
    
    3
    
    
    
    37
    
    
    
    5
    
    
    
    42
    
    
    
    6
    
    
    
    25
    
    
    
    52Fujian (2)
    
    
    
    
    
    
    50
    
    
    
    1
    
    
    
    57
    
    
    
    2
    
    
    
    
    
    
    
    70Gansu
    
    
    
    
    
    
    10
    
    
    
    1
    
    
    
    15
    
    
    
    1
    
    
    
    
    
    
    
    18Guangdong
    
    
    2
    
    
    
    45
    
    
    
    2
    
    
    
    47
    
    
    
    2
    
    
    
    
    
    
    
    54Guangxi
    
    
    7
    
    
    
    45
    
    
    
    9
    
    
    
    50
    
    
    
    10
    
    
    
    24
    
    
    
    59Guizhou
    
    
    
    
    
    
    24
    
    
    
    
    
    
    
    24
    
    
    
    
    
    
    
    
    
    
    
    38Hainan (3)
    
    
    
    
    
    
    5
    
    
    
    
    
    
    
    5
    
    
    
    
    
    
    
    
    
    
    
    5Heilongjiang
    
    
    2
    
    
    
    38
    
    
    
    2
    
    
    
    47
    
    
    
    4
    
    
    
    9
    
    
    
    51Hebei
    
    
    
    
    
    
    17
    
    
    
    
    
    
    
    21
    
    
    
    
    
    
    
    2
    
    
    
    27Henan
    
    
    3
    
    
    
    27
    
    
    
    5
    
    
    
    38
    
    
    
    5
    
    
    
    6
    
    
    
    48Hubei
    
    
    1
    
    
    
    27
    
    
    
    1
    
    
    
    28
    
    
    
    4
    
    
    
    38
    
    
    
    38Hunan
    
    
    1
    
    
    
    53
    
    
    
    3
    
    
    
    64
    
    
    
    5
    
    
    
    29
    
    
    
    76Inner Mongolia
    
    
    
    
    
    
    17
    
    
    
    
    
    
    
    22
    
    
    
    
    
    
    
    
    
    
    
    27Jiangsu
    
    
    
    
    
    
    27
    
    
    
    1
    
    
    
    28
    
    
    
    1
    
    
    
    19
    
    
    
    44Jiangxi
    
    
    
    
    
    
    35
    
    
    
    
    
    
    
    36
    
    
    
    
    
    
    
    3
    
    
    
    39Jilin (4)
    
    
    
    
    
    
    8
    
    
    
    
    
    
    
    9
    
    
    
    
    
    
    
    9
    
    
    
    11Liaoning
    
    
    1
    
    
    
    40
    
    
    
    1
    
    
    
    43
    
    
    
    9
    
    
    
    23
    
    
    
    41Ningxia (5)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2
    
    
    
    
    
    
    
    
    
    
    
    2Shaanxi
    
    
    
    
    
    
    30
    
    
    
    
    
    
    
    31
    
    
    
    
    
    
    
    14
    
    
    
    43Shandong (6)
    
    
    2
    
    
    
    24
    
    
    
    2
    
    
    
    26
    
    
    
    2
    
    
    
    21
    
    
    
    38Shanghai (7)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2Shanxi
    
    
    
    
    
    
    15
    
    
    
    
    
    
    
    18
    
    
    
    1
    
    
    
    
    
    
    
    23Sichuan
    
    
    
    
    
    
    17
    
    
    
    
    
    
    
    19
    
    
    
    
    
    
    
    
    
    
    
    22Tianjin (8)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2
    
    
    
    
    
    
    
    
    
    
    
    5Tibet (9)
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    1Xinjiang
    
    
    5
    
    
    
    32
    
    
    
    9
    
    
    
    40
    
    
    
    10
    
    
    
    7
    
    
    
    47Yunnan
    
    
    
    
    
    
    29
    
    
    
    1
    
    
    
    34
    
    
    
    1
    
    
    
    12
    
    
    
    37Zhejiang
    
    
    2
    
    
    
    43
    
    
    
    5
    
    
    
    54
    
    
    
    4
    
    
    
    67
    
    
    
    64Total
    
    
    30
    
    
    
    720
    
    
    
    49
    
    
    
    827
    
    
    
    68
    
    
    
    326
    
    
    
    1,009
 
 (1)
    
    We currently do not have a distributor covering Anhui Province. Our retail outlets located in Anhui Province are authorized and supervised by our distributor for Zhejiang Province.(2)
    
    We currently have two distributors in Fujian Province covering different regions within Fujian Province.(3)
    
    We currently do not have a distributor covering Hainan Province. Our retail outlets located in Hainan Province are authorized and supervised by our distributor for Guangdong Province.(4)
    
    We currently do not have a distributor covering Jilin Province. Our retail outlets located in Jilin Province are authorized and supervised by our distributor for Liaoning Province.(5)
    
    We currently do not have a distributor covering Ningxia Autonomous Region. Our retail outlets located in Ningxia Autonomous Region are authorized and supervised by our distributor for Gansu Province.(6)
    
    We currently have two distributors in Shandong Province covering different regions within Shandong Province.(7)
    
    We currently do not have a distributor covering Shanghai. Our retail outlets located in Shanghai are authorized and supervised by our distributor for Zhejiang Province.(8)
    
    We currently do not have a distributor covering Tianjin. Our retail outlets located in Tianjin are authorized and supervised by our distributor for Beijing.(9)
    
    We currently do not have a distributor covering Tibet Autonomous Region. Our retail outlet located in Tibet Autonomous Region is authorized and supervised by our distributor for Sichuan Province.(10)
    
    We commenced restructuring of our authorized retail outlet network to transfer the department store chains as authorized retailers under the management and supervision of our distributors in 2010.   34
    Table of Contents  
    
    Product exclusivity:Our distributors are required to sell only our products at Xiniya-branded retail
outlets managed by them or authorized retailers.
    
    Geographic exclusivity:Each distributor is only authorized to sell our products within an
exclusively defined geographical region.
    
    Undertaking:Our distributors undertake to comply with our pricing and discount policies, follow our
uniform store design and display standards and refrain from selling other branded mens apparel
products and counterfeit products.
    
    Minimum purchase requirement and deposit:Each of our distributors is expected to purchase a minimum
amount of our products each year, which, for example, ranges from RMB10.0 million to RMB95.0 million in
2011, as specified in the respective distributorship agreements, and pay a deposit to us that is
refundable, provided that such distributor does not materially violate its distributorship agreement
with us. If a distributor fails to meet the minimum purchase amount, we have the right to terminate its
distributorship agreement and withhold part or all of the deposit as a penalty.
    
    Payment, credit terms and delivery:We will deliver the products to our distributors upon receiving
payment from them. We typically require our distributors to make payments for the purchase of our
products in installments on a monthly basis with the full payment required to be made within three
months of the delivery of the products. We may, however, extend credit to our distributors in certain
circumstances. For example, due to the financial crisis and economic downturn in 2008, we extended the
credit period for our distributors. We make the delivery arrangements, but the distributors bear the
costs of delivery and insurance.
    
    Pricing:We agree to sell our products to our distributors at a uniform price across all distributors.
    
    Return of products:We will only accept product returns from distributors for quality reasons and
only if the distributors followed our standard procedures in processing the returned products.
    
    Authorized retailers:Distributors are permitted to sub-contract the operation of retail outlets to
third parties, subject to our approval of the location and renovation plan. Distributors must instruct
their third party retailers to comply with the relevant requirements for the retail outlets for our
products included in the distributorship agreements and our pricing and discount policies, follow our
uniform store design and display standards and refrain from selling counterfeit products. In addition,
the third party authorized retailers are generally prohibited by our distributors from selling other
branded mens apparel products.
    
    Termination:We have the right to terminate the agreements if the distributors fail to comply with
certain provisions of the distributorship agreements, including but not limited to failure or delay in
paying the deposit, sale by the distributors of counterfeit products and sales of goods outside of
their designated region. Our distributors do not have termination rights under the distributorship
agreements.
  35
    Table of Contents  Department Store Chains
   As of December 31,2008
    
    2009
    
    2010(1)Anhui
    
    
    13
    
    
    
    18
    
    
    
    18Beijing
    
    
    
    
    
    
    
    
    
    
    Chongqing
    
    
    21
    
    
    
    22
    
    
    
    25Fujian
    
    
    
    
    
    
    
    
    
    
    Gansu
    
    
    
    
    
    
    
    
    
    
    Guangdong
    
    
    
    
    
    
    
    
    
    
    Guangxi
    
    
    18
    
    
    
    22
    
    
    
    24Guizhou
    
    
    
    
    
    
    
    
    
    
    Hainan
    
    
    
    
    
    
    
    
    
    
    Heilongjiang
    
    
    8
    
    
    
    8
    
    
    
    9Hebei
    
    
    1
    
    
    
    2
    
    
    
    2Henan
    
    
    4
    
    
    
    6
    
    
    
    6Hubei
    
    
    27
    
    
    
    32
    
    
    
    38Hunan
    
    
    15
    
    
    
    27
    
    
    
    29Inner Mongolia
    
    
    
    
    
    
    
    
    
    
    Jiangsu
    
    
    17
    
    
    
    18
    
    
    
    19Jiangxi
    
    
    3
    
    
    
    3
    
    
    
    3Jilin
    
    
    7
    
    
    
    8
    
    
    
    9Liaoning
    
    
    21
    
    
    
    22
    
    
    
    23Shaanxi
    
    
    12
    
    
    
    14
    
    
    
    14Shandong
    
    
    19
    
    
    
    20
    
    
    
    21Shanghai
    
    
    
    
    
    
    
    
    
    
    Shanxi
    
    
    
    
    
    
    
    
    
    
    Sichuan
    
    
    
    
    
    
    
    
    
    
    Tianjin
    
    
    
    
    
    
    
    
    
    
    Tibet
    
    
    
    
    
    
    
    
    
    
    Xinjiang
    
    
    7
    
    
    
    7
    
    
    
    7Yunnan
    
    
    10
    
    
    
    12
    
    
    
    12Zhejiang
    
    
    54
    
    
    
    63
    
    
    
    67Total
    
    
    257
    
    
    
    304
    
    
    
    326
 
 (1)
    
    As of December 31, 2010, all 326 department store concessions had been placed under the
management and supervision of our distributors and sold products purchased from our
distributors instead of directly from us. We now consider the department store concessions
as retail outlets under our network of distributors.  36
    Table of Contents  
    
    Geographic coverage:Each department store chain was
authorized to sell our products within the geographical
regions where such department store chain had operations.
    
    Undertaking:The department store chains undertook to
comply with our marketing policies and refrain from selling
counterfeit products.
    
    Payment and credit terms:Department store chains were
required to pay us within three months after receiving our
products.
    
    Return of products:We would only accept product returns
from a department store chain if such department store
chain had followed our standard procedures in processing
the returned products.
   Management and Growth Control of Our Authorized Retail Network
  Expansion Plans For Our Authorized Retail Network
  Seasonality
  37
    Table of Contents  Raw Materials
  Pricing Policy
  Marketing and Advertising
     38
    Table of Contents  Intellectual Property Rights
    Competition
    Insurance
  39
    Table of Contents  Regulation
  Wholly Foreign-Owned Enterprise
    Product Quality
   
    
    to adopt a check-for-acceptance system for stock replenishment to examine the quality
certificates and other labels of such stock;
    
    to take measures in keeping products for sale in good quality;
    
    not to sell defective or deteriorated products or products which have been publicly ordered
to cease sales;
    
    to sell products with labels that comply with the relevant provisions;
    
    not to forge the origin of a product, or falsely use the name and address of another producer;
 40
    Table of Contents  
    
    not to forge or falsely use product quality marks such as authentication marks; and
    
    not to mix impurities or imitations into the products, substitute a fake product for a
genuine one, a defective product for a high-quality one, or pass off a substandard product as
a qualified one in the sale of products.Pursuant to the Product Quality Law, a producer shall:
    
    be responsible for the quality of products it produces;
    
    not produce products that have been publicly ordered to cease production;
    
    not forge the origin of a product, or to forge or falsely use the name and address of another producer;
    
    not forge or falsely use product quality marks such as authentication marks of another producer;
    
    not mix impurities or imitations into the products, substitute a fake product for a genuine one, a
defective product for a high-quality one, or pass off a substandard product as a qualified one in the
production;
    
    ensure that the marks on the products or the packaging of the products are true; and
    
    ensure that, for products that are easily broken, inflammable, explosive, toxic, erosive or
radioactive and products that cannot be handled upside down in the process of storage or
transportation or for which there are other special requirements, the packaging thereof must meet the
corresponding requirements, carry warning marks or warnings written in Chinese or draw attention to
the method of handling in accordance with the relevant provisions of the state.
    Consumer Protection
  
    
    goods and services provided to consumers must comply with
the Product Quality Law and other relevant laws and
regulations, including requirements regarding personal
safety and protection of property;
    
    providing consumers with true information and advertising
concerning goods and services, as well as providing true
and clear answers to questions raised by consumers
concerning the quality and use of
 41
    Table of Contents  goods or services
provided by them;
 
    
    issuing purchase or service vouchers to consumers in
accordance with relevant national regulations or business
practices or upon the request of a consumer;
    
    ensuring the quality, functionality, applications and
duration of use of the goods or services under normal use
and ensuring that the actual quality of the goods or
services are consistent with that displayed in advertising
materials, product descriptions or samples;
    
    properly performing its responsibilities for guaranteed
repair, replacement and return or other liability in
accordance with national regulations or any agreement with
the consumer; and
    
    not setting unreasonable or unfair terms for consumers or
excluding themselves from civil liability for undermining
the legal rights and interests of consumers by means of
standard contracts, circulars, announcements, shop notices,
etc.
   Trademark Law
   
    
    using a trademark which is identical with or similar to the registered trademark on the same kind
of commodities or similar commodities without a license from the registrant of that trademark;
    
    selling the commodities that infringe upon the right to the exclusive use of a registered trademark;
    
    forging, manufacturing without authorization the marks of a registered trademark of others, or
selling the marks of a registered trademark forged or manufactured without authorization;
    
    changing a registered trademark and putting the commodities with the changed trademark into the
market without the consent of the registrant of that trademark; and
    
    causing other damage to the right to the exclusive use of a registered trademark of another person.
  42
    Table of Contents  Environmental Laws
      Labor Contract Law
  43
    Table of Contents  Production Safety Law
  Social Insurance Regulations
    Foreign Exchange Registration of Offshore Investment by PRC Residents
    44
    Table of Contents  Foreign Currency Exchange
   Dividend Distribution
   Provisions Regarding Mergers and Acquisitions of Domestic Enterprises by Foreign Investors
  45
    Table of Contents  C. Organizational Structure
  D. Property, Plants and Equipment
   
 ITEM 4A. UNRESOLVED STAFF COMMENTS
  
 ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
 You should read the following discussion and analysis of our financial condition and results
of operations in conjunction with our financial statements and the related notes included
elsewhere in this annual report. This discussion contains forward-looking statements that involve
risks, uncertainties and assumptions. Our actual results and the timing of selected events could
differ materially from those anticipated in these forward-looking statements as a result of
various factors, including those set forth under Item 3. Key InformationD. Risk Factors and
elsewhere in this annual report.
 A. Operating Results
 Overview
   46
    Table of Contents  Factors Affecting our Financial Performance and Results of Operations
  
    
    Economic growth, level of per capita disposable income and consumer spending patterns in
the PRC;
    
    Our relationships with, and the business performance of, our distributors and their
authorized retailers and department store chains;
    
    Our ability to maintain and enhance the recognition of our Xiniya brand;
    
    Our ability to address the needs and preferences of our target consumers in a timely manner;
    
    Seasonality;
    
    Competition;
    
    Our relationships with, and the performance of, our contract manufacturers; and
    
    Taxation.
 Economic Growth, Level of Per Capita Disposable Income and Consumer Spending Patterns in
the PRC
  47
    Table of Contents  Our Relationships with, and the Business Performance of, Our Distributors and Their Authorized
Retailers and Department Store Chains
     48
    Table of Contents  Our Ability to Maintain and Enhance the Recognition of Our Xiniya Brand
  Our Ability to Address the Needs and Preferences of our Target Consumers in a Timely Manner
  Seasonality
  Competition
  49
    Table of Contents  Our Relationships with, and the Performance of, our Contract Manufacturers
   Revenues
  For the Year Ended December 31,2008
    
    
    2009
    
    
    2010RMB
    
    
    RMB
    
    
    RMB
    
    
    $(amounts in thousands, except average unit selling price)Revenues
    
    
    479,711
    
    
    
    672,075
    
    
    
    899,252
    
    
    
    136,251Cost of sales
    
    
    (313,521
    )
    
    
    (438,773
    )
    
    
    (589,233
    )
    
    
    (89,278
    )Gross profit
    
    
    166,190
    
    
    
    233,302
    
    
    
    310,019
    
    
    
    46,973Gross profit margin
    
    
    34.6
    %
    
    
    34.7
    %
    
    
    34.5
    %
    
    
    Number of units sold
    
    
    3,791
    
    
    
    5,104
    
    
    
    5,615
    
    
    
    Average unit
selling price (1)
    
    
    126.5
    
    
    
    131.7
    
    
    
    160.2
    
    
    
    24.3
 50
    Table of Contents  (1)
    
    Average unit selling price is calculated by dividing the revenues for
the year/period by the number of units sold. However, the price of any
particular unit may vary significantly depending on the type of
apparel and accessories. Breakdown of Revenues by Product Line
   For the Year Ended December 31,2008
    
    2009
    
    2010% of
    
    
    
    
    
    % of
    
    
    
    
    
    
    
    
    
    % ofAmount
    
    Revenues
    
    Amount
    
    Revenues
    
    Amount
    
    RevenuesRMB
    
    
    
    
    
    RMB
    
    
    
    
    
    RMB
    
    $(amounts in thousands, except for percentages)Business casual
    
    
    411,576
    
    
    
    85.8
    %
    
    
    622,538
    
    
    
    92.6
    %
    
    
    804,255
    
    
    
    121,857
    
    
    
    89.4
    %Business formal
    
    
    66,511
    
    
    
    13.9
    %
    
    
    42,567
    
    
    
    6.3
    %
    
    
    84,611
    
    
    
    12,820
    
    
    
    9.4
    %Accessories
    
    
    1,624
    
    
    
    0.3
    %
    
    
    6,970
    
    
    
    1.1
    %
    
    
    10,386
    
    
    
    1,574
    
    
    
    1.2
    %479,711
    
    
    
    100.0
    %
    
    
    672,075
    
    
    
    100.0
    %
    
    
    899,252
    
    
    
    136,251
    
    
    
    100.0
    %
   Breakdown of Revenues by Sales Channel
  51
    Table of Contents  For the Year Ended December 31,2008
    
    2009
    
    2010% of
    
    
    
    
    
    % of
    
    
    
    
    
    
    
    
    
    % ofAmount
    
    Revenues
    
    Amount
    
    Revenues
    
    Amount
    
    RevenuesRMB
    
    
    
    
    
    RMB
    
    
    
    
    
    RMB
    
    $(amounts in thousands, except for percentages)Distributors
    
    
    302,007
    
    
    
    63.0
    %
    
    
    413,858
    
    
    
    61.6
    %
    
    
    741,536
    
    
    
    112,354
    
    
    
    82.5
    %Department store
chains
    
    
    174,728
    
    
    
    36.4
    %
    
    
    253,733
    
    
    
    37.7
    %
    
    
    154,183
    
    
    
    23,361
    
    
    
    17.1
    %Flagship store
    
    
    2,976
    
    
    
    0.6
    %
    
    
    4,484
    
    
    
    0.7
    %
    
    
    3,533
    
    
    
    536
    
    
    
    0.4
    %479,711
    
    
    
    100.0
    %
    
    
    672,075
    
    
    
    100.0
    %
    
    
    899,252
    
    
    
    136,251
    
    
    
    100.0
    %
  Operating Costs and Expenses
  For the Year Ended December 31,2008
    
    2009
    
    2010% of
    
    
    
    
    
    % of
    
    
    
    
    
    
    
    
    
    % ofAmount
    
    Revenues
    
    Amount
    
    Revenues
    
    Amount
    
    RevenuesRMB
    
    
    
    
    
    RMB
    
    
    
    
    
    RMB
    
    $(amounts in thousands, except for percentages)Cost of sales
    
    
    313,521
    
    
    
    65.4
    %
    
    
    438,773
    
    
    
    65.3
    %
    
    
    589,233
    
    
    
    89,278
    
    
    
    65.5
    %Selling and distribution
expenses (1)
    
    
    15,925
    
    
    
    3.3
    %
    
    
    8,744
    
    
    
    1.3
    %
    
    
    11,999
    
    
    
    1,818
    
    
    
    1.3
    %Administrative expenses
    
    
    6,813
    
    
    
    1.4
    %
    
    
    2,898
    
    
    
    0.4
    %
    
    
    10,108
    
    
    
    1,531
    
    
    
    1.2
    %Total operating costs and
expenses
    
    
    336,259
    
    
    
    70.1
    %
    
    
    450,415
    
    
    
    67.0
    %
    
    
    611,340
    
    
    
    92,627
    
    
    
    68.0
    %
 
 (1)
    
    We do not hold significant inventories and do not incur significant purchasing, receiving or warehousing costs. Cost of Sales
   52
    Table of Contents  For the Year Ended December 31,2008
    
    
    2009
    
    
    2010% of Cost of
    
    
    
    
    
    
    
    
    
    
    % of Cost of
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    % of Cost ofOur Own
    
    
    % of Cost
    
    
    
    
    
    
    Our Own
    
    
    % of Cost
    
    
    
    
    
    
    
    
    
    
    Our Own
    
    
    % of CostRMB
    
    
    Production
    
    
    of Sales
    
    
    RMB
    
    
    Production
    
    
    of Sales
    
    
    RMB
    
    
    $
    
    
    Production
    
    
    of Sales(amounts in thousands, except for percentages)Own productionRaw materials
    
    
    80,739
    
    
    
    75.9
    %
    
    
    25.8
    %
    
    
    85,543
    
    
    
    74.6
    %
    
    
    19.5
    %
    
    
    16,230
    
    
    
    2,459
    
    
    
    69.4
    %
    
    
    2.7
    %Direct labor
    
    
    15,842
    
    
    
    14.9
    %
    
    
    5.1
    %
    
    
    20,561
    
    
    
    17.9
    %
    
    
    4.7
    %
    
    
    4,066
    
    
    
    616
    
    
    
    17.4
    %
    
    
    0.7
    %Sub-contracting expenses
    
    
    5,075
    
    
    
    4.8
    %
    
    
    1.6
    %
    
    
    3,639
    
    
    
    3.2
    %
    
    
    0.8
    %
    
    
    921
    
    
    
    140
    
    
    
    3.9
    %
    
    
    0.2
    %Overhead
    
    
    4,674
    
    
    
    4.4
    %
    
    
    1.5
    %
    
    
    4,969
    
    
    
    4.3
    %
    
    
    1.1
    %
    
    
    2,173
    
    
    
    329
    
    
    
    9.3
    %
    
    
    0.4
    %Sub-total
    
    
    106,330
    
    
    
    100.0
    %
    
    
    34.0
    %
    
    
    114,712
    
    
    
    100.0
    %
    
    
    26.1
    %
    
    
    23,390
    
    
    
    3,544
    
    
    
    100.0
    %
    
    
    4.0
    %Outsourced production
Purchases
    
    
    198,585
    
    
    
    N/A
    
    
    
    63.3
    %
    
    
    314,296
    
    
    
    N/A
    
    
    
    71.6
    %
    
    
    556,353
    
    
    
    84,296
    
    
    
    N/A
    
    
    
    94.4
    %Research and Development
Expenses
    
    
    8,260
    
    
    
    N/A
    
    
    
    2.6
    %
    
    
    9,294
    
    
    
    N/A
    
    
    
    2.2
    %
    
    
    8,588
    
    
    
    1,301
    
    
    
    N/A
    
    
    
    1.5
    %Tax
    
    
    346
    
    
    
    N/A
    
    
    
    0.1
    %
    
    
    471
    
    
    
    N/A
    
    
    
    0.1
    %
    
    
    902
    
    
    
    137
    
    
    
    N/A
    
    
    
    0.1
    %Total
    
    
    313,521
    
    
    
    N/A
    
    
    
    100.0
    %
    
    
    438,773
    
    
    
    N/A
    
    
    
    100.0
    %
    
    
    589,233
    
    
    
    89,278
    
    
    
    N/A
    
    
    
    100.0
    %
   For the Year Ended December 31,2008
    
    
    2009
    
    
    2010% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    
    
    
    
    % ofCost of
    
    
    
    
    
    
    Cost of
    
    
    
    
    
    
    
    
    
    
    Cost ofAmount
    
    
    Sales
    
    
    Amount
    
    
    Sales
    
    
    Amount
    
    
    SalesRMB
    
    
    
    
    
    
    RMB
    
    
    
    
    
    
    RMB
    
    
    $(amounts in thousands, except for percentages)Business casual
    
    
    268,705
    
    
    
    85.7
    %
    
    
    405,309
    
    
    
    92.4
    %
    
    
    525,294
    
    
    
    79,590
    
    
    
    89.1
    %Business formal
    
    
    43,274
    
    
    
    13.8
    %
    
    
    28,107
    
    
    
    6.4
    %
    
    
    55,490
    
    
    
    8,408
    
    
    
    9.4
    %Accessories
    
    
    1,196
    
    
    
    0.4
    %
    
    
    4,886
    
    
    
    1.1
    %
    
    
    7,547
    
    
    
    1,143
    
    
    
    1.3
    %Tax
    
    
    346
    
    
    
    0.1
    %
    
    
    471
    
    
    
    0.1
    %
    
    
    902
    
    
    
    137
    
    
    
    0.2
    %313,521
    
    
    
    100.0
    %
    
    
    438,773
    
    
    
    100.0
    %
    
    
    589,233
    
    
    
    89,278
    
    
    
    100.0
    %
 Selling and Distribution Expenses
    53
    Table of Contents  Administrative Expenses
     Taxation
  Critical Accounting Policies and Estimates
  
    
    our critical accounting policies discussed below;
    
    the related judgment made by our management and other
uncertainties affecting the application of these policies;
    
    the sensitivity of our reported results to changes in
prevailing facts and circumstances and our related
estimates and assumptions; and
    
    the risks and uncertainties described under Risk Factors.
  54
    Table of Contents  Revenue Recognition
  Sales of goods  distributors and department store chains
  Sales of goods  retail
 Interest income
 Impairment of Trade Receivables
  Net Realizable Value of Inventories
  Income Tax
  Share-based Compensation
  55
    Table of Contents  Internal Control Over Financial Reporting
   56
    Table of Contents  
    
    Hire additional financial reporting and accounting personnel with relevant accounting
experience, skills and knowledge in IFRS and SEC rules and regulations;
    
    Engage, as necessary, a qualified external consultant with extensive experience in IFRS
reporting and accounting to assist us in the supervision and review of the financial
reporting process;
    
    Develop a formal plan and program to assess the effectiveness of our internal control
over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act;
    
    Develop a formal plan to provide applicable IFRS and SEC training for our financial and
accounting staff;
    
    Establish procedures to eventually eliminate any significant payments made on our
behalf by our controlling shareholder and instead to have the company directly make any
such payments; and
    
    Develop a formal plan to ensure that any and all Company expenses paid for by our
controlling shareholder are properly documented, summarized, recorded and monitored
utilizing expense reports and other forms of documentation.
    Results of Operations
  For the Year Ended December 31,2008
    
    2009
    
    2010RMB
    
    RMB
    
    RMB
    
    $(amounts in thousands, except for percentages)RevenuesBusiness casual
    
    
    411,576
    
    
    
    622,538
    
    
    
    804,255
    
    
    
    121,857Business formal
    
    
    66,511
    
    
    
    42,567
    
    
    
    84,611
    
    
    
    12,820Accessories
    
    
    1,624
    
    
    
    6,970
    
    
    
    10,386
    
    
    
    1,574Total revenues
    
    
    479,711
    
    
    
    672,075
    
    
    
    899,252
    
    
    
    136,251Operating Costs and ExpensesCost of sales
    
    
    (313,521
    )
    
    
    (438,773
    )
    
    
    (589,233
    )
    
    
    (89,278
    )Selling and distribution expenses
    
    
    (15,925
    )
    
    
    (8,744
    )
    
    
    (11,999
    )
    
    
    (1,818
    )Administrative expenses
    
    
    (6,813
    )
    
    
    (2,898
    )
    
    
    (10,108
    )
    
    
    (1,531
    )Total operating costs and expenses
    
    
    (336,259
    )
    
    
    (450,415
    )
    
    
    (611,340
    )
    
    
    (92,627
    )
 57
    Table of Contents  For the Year Ended December 31,2008
    
    2009
    
    2010RMB
    
    RMB
    
    RMB
    
    $(amounts in thousands, except for percentages)Operating Income
    
    
    143,452
    
    
    
    221,660
    
    
    
    287,912
    
    
    
    43,624Interest income
    
    
    677
    
    
    
    793
    
    
    
    847
    
    
    
    128Income Before Tax
    
    
    144,129
    
    
    
    222,453
    
    
    
    288,759
    
    
    
    43,752Income tax expenses
    
    
    (18,112
    )
    
    
    (28,109
    )
    
    
    (36,413
    )
    
    
    (5,517
    )Net Profit
    
    
    126,017
    
    
    
    194,344
    
    
    
    252,346
    
    
    
    38,235Net profit margin (%)
    
    
    26.3
    %
    
    
    28.9
    %
    
    
    28.1
    %
 Year ended December 31, 2010 compared to year ended December 31, 2009
 Revenues
     Cost of Sales
  58
    Table of Contents  Selling and Distribution Expenses
  Administrative Expenses
  Income Tax Expense
  Profit for the Year and Net Margin
  Year ended December 31, 2009 compared to year ended December 31, 2008
 Revenues
   59
    Table of Contents  Cost of Sales
   Selling and Distribution Expenses
  Administrative Expenses
  Income Tax Expense
  60
    Table of Contents  Profit for the Year and Net Margin
  B. Liquidity and Capital Resources
 Liquidity
    For the Year Ended December 31,2008
    
    2009
    
    2010RMB
    
    RMB
    
    RMB
    
    $(amounts in thousands)Net cash generated by operating activities
    
    
    117,964
    
    
    
    99,769
    
    
    
    191,576
    
    
    
    29,027Net cash generated by investing activities
    
    
    
    
    
    
    
    
    
    
    394
    
    
    
    60Net cash (used in) generated by financing activities
    
    
    (61,381
    )
    
    
    (114,106
    )
    
    
    528,525
    
    
    
    80,079Cash and cash equivalents at beginning of period
    
    
    100,056
    
    
    
    156,639
    
    
    
    142,302
    
    
    
    21,561Cash and cash equivalents at end of period
    
    
    156,639
    
    
    
    142,302
    
    
    
    862,797
    
    
    
    130,727
  Cash Flow Generated By Operating Activities
   61
    Table of Contents  Cash Flow Provided by (Used in) Investing Activities
  Cash Flow Provided by (Used in) Financing Activities
   62
    Table of Contents  Capital Resources
  C. Research and Development
  D. Trend Information
  E. Off-Balance Sheet Arrangements
  F. Tabular Disclosure of Contractual Obligations
  Payments Due By PeriodLess Than
    
    
    
    
    
    More ThanTotal
    
    1 Year
    
    1-5 Years
    
    5 Years(RMB in thousands)Operating Lease Commitments
    
    
    4,920
    
    
    
    984
    
    
    
    3,936
    
    
    
    Purchase Commitments
    
    
    23,170
    
    
    
    23,170
    
    
    
    
    
    
    
    
  63
    Table of Contents  G. Safe Harbor
  
 ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
 A. Directors and Senior Management
  Name
    
    Age
    
    Position/ TitleQiming Xu
    
    
    42
    
    
    Chairman and Chief Executive OfficerKangkai Zeng
    
    
    36
    
    
    Director and Chief Operating OfficerPeter M. McGrath
    
    
    61
    
    
    Independent DirectorKim Yoke Ng
    
    
    57
    
    
    Independent DirectorBin Yang
    
    
    49
    
    
    Independent DirectorMingjiang Liu
    
    
    38
    
    
    Deputy General Manager and Sales and Marketing DirectorChee Jiong Ng
    
    
    40
    
    
    Chief Financial OfficerQiwen Yang
    
    
    37
    
    
    Chief DesignerChongchun Wang
    
    
    41
    
    
    Chief Production Officer
 Mr. Qiming Xu
 Mr. Kangkai Zeng
 Mr. Peter M. McGrath
 Ms. Kim Yoke Ng
 64
    Table of Contents  Professor Bin Yang
 Mr. Mingjiang Liu
 Mr. Chee Jiong Ng
 Mr. Qiwen Yang (also known as Zi Yang )
 Mr. Chongchun Wang
 65
    Table of Contents  B. Compensation
 Compensation of Directors and Executive Officers
    2010 Equity Incentive Plan
  Options
 Restricted shares
 Share appreciation rights
 66
    Table of Contents  Performance units and performance shares
 Restricted share units
 Amendment and termination
 C. Board Practices
 Board of Directors
  Terms of Directors and Executive Officers
  Committees of the Board of Directors
  Audit Committee
  
    
    appointing our independent auditors and pre-approving all auditing and non-auditing services
permitted to be performed by our independent auditors;
    
    reviewing with our independent auditors any audit problems or difficulties and managements
response;
    
    reviewing and approving all proposed related party transactions;
    
    discussing the annual audited financial statements with management and our independent auditors;
 67
    Table of Contents  
    
    reviewing major issues as to the adequacy of our internal controls and any special audit steps
adopted in light of our current material weaknesses in internal control;
    
    annually reviewing and reassessing the adequacy of our audit committee charter;
    
    such other matters that are specifically delegated to our audit committee by our board of
directors from time to time;
    
    meeting separately and periodically with management and our internal and independent auditors;
and
    
    reporting regularly to the full board of directors.
 Compensation Committee
  
    
    approving and overseeing the compensation package for our executive officers;
    
    reviewing and making recommendations to the board with respect to the
compensation of our directors;
    
    reviewing and approving corporate goals and objectives relevant to the
compensation of our chief executive officer, evaluating the performance of
our chief executive officer in light of those goals and objectives and
setting the compensation level of our chief executive officer based on this
evaluation; and
    
    reviewing periodically and making recommendations to the board regarding any
long-term incentive compensation or equity plans, programs or similar
arrangements, annual bonuses, employee pension and welfare benefit plans.
 Nominating and Corporate Governance Committee
  
    
    identifying and recommending to the board nominees for election or re-election to the board, or for
appointment to fill any vacancy;
    
    reviewing annually with the board the current composition of the board in light of the
characteristics of independence, age, skills, experience and availability of service to us;
    
    identifying and recommending to the board the directors to serve as members of the boards committees;
    
    advising the board periodically with respect to significant developments in the law and practice of
corporate governance as well as our compliance with applicable laws and regulations and making
recommendations to the board on all matters of corporate governance and on any corrective action to
be taken; and
 68
    Table of Contents  
    
    monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy
and effectiveness of our procedures to ensure proper compliance.
 Interested Transactions
  Remuneration and Borrowing
  Qualification
  Employment Agreements
   D. Employees
  As of December 31,Functions
    
    2010Sales & Marketing
    
    
    48Production
    
    
    206Product Development
    
    
    26Administration
    
    
    37Total
    
    
    317
  69
    Table of Contents  E. Share Ownership
  
    
    each of our directors and executive officers; and
    
    each person known to us to own beneficially more than 5% of our ordinary shares.
 Shares Beneficially Owned (1)(2)Number
    
    %Directors and Executive OfficersQiming Xu (3)
    
    
    133,884,000
    
    
    
    57.7Kangkai Zeng (4)
    
    
    116,000
    
    
    
    0.1Mingjiang Liu
    
    
    
    
    
    
    Chee Jiong Ng
    
    
    
    
    
    
    Qiwen Yang
    
    
    
    
    
    
    Qifa Zhang
    
    
    
    
    
    
    All directors and executive officers as a group
    
    
    134,000,000
    
    
    
    57.8Principal ShareholdersTung Kwo Li (5)
    
    
    12,000,000
    
    
    
    5.2
 
 (1)
    
    Beneficial ownership is determined in accordance with the rules of
the SEC and includes voting or investment power with respect to
the ordinary shares. In computing the number of shares
beneficially owned by a person and the percentage ownership of
that person, we have included shares that the person has the right
to acquire within 60 days.(2)
    
    Percentage of beneficial ownership of each listed person is based
on 232,000,000 ordinary shares outstanding as of the date of this
annual report.(3)
    
    Consists of 134,000,000 shares held by Qiming Investment Limited, a British Virgin Islands Company.
Mr. Qiming Xu is the sole director of Qiming Investment Limited.(4)
    
    Consists of 116,000 shares granted by Mr. Qiming Xu upon the completion of our initial public offering. 70
    Table of Contents  (5)
    
    Mr. Tung Kwo Li is a resident of Hong Kong and the address of Mr. Tung Kwo Li is Room 3607, Tower One,
Lippo Centre, 89 Queensway, Hong Kong. 
 ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
 A. Major Shareholders
    B. Related Party Transactions
  Acquisition of Trademarks from Shishi Xiniya
   Lease of Facilities from Jinjiang Xiniya
  Transactions between Mr. Qiming Xu and Mr. Hing Tuen Wong
  71
    Table of Contents  Other Transactions with Mr. Qiming Xu
  C. Interests of Experts and Counsel
  
 ITEM 8. FINANCIAL INFORMATION
 A. Consolidated Statements and Other Financial Information
  Legal and Administrative Proceedings
  Dividend Policy
   B. Significant Changes
  72
    Table of Contents  ITEM 9. THE OFFER AND LISTING
  Market Price Per ADSHigh
    
    Low($)
    
    ($)2010 Fourth Quarter (from November 23, 2010)
    
    
    11.44
    
    
    
    8.65November
    
    
    11.44
    
    
    
    9.75December
    
    
    11.10
    
    
    
    8.652011 First QuarterJanuary
    
    
    10.05
    
    
    
    5.56February
    
    
    6.09
    
    
    
    4.62March
(through March 23, 2011)
    
    
    4.58
    
    
    
    4.10
 B. Plan of Distribution
  C. Markets
  D. Selling Shareholders
  E. Dilution
  F. Expenses of the Issue
  
 ITEM 10. ADDITIONAL INFORMATION
 A. Share Capital
  B. Memorandum and Articles of Association
  C. Material Contracts
  73
    Table of Contents  D. Exchange Controls
  E. Taxation
 Cayman Islands Taxation
  PRC Taxation
  United States Federal Income Taxation
   
    
    banks;
    
    certain financial institutions;
    
    insurance companies;
    
    broker dealers;
    
    U.S. expatriates;
 74
    Table of Contents  
    
    traders that elect to mark to market;
    
    tax-exempt entities;
    
    persons liable for alternative minimum tax;
    
    persons holding an ADS or ordinary share as part of a straddle, hedging,
conversion or integrated transaction; or
    
    persons that actually or constructively own 10% or more of our voting stock.
  
    
    an individual citizen or resident of the United States for U.S. federal income tax purposes;
    
    a corporation (or other entity treated as a corporation for U.S. federal income tax purposes)
located or organized in or under the laws of the United States, any State thereof or the
District of Columbia;
    
    an estate whose income is subject to U.S. federal income taxation regardless of its source; or
    
    a trust that (1) is subject to the supervision of a court within the United States and the
control of one or more U.S. persons or (2) has a valid election in effect under applicable
U.S. Treasury regulations to be treated as a U.S. person.
   Taxation of Dividends and Other Distributions on the ADSs or Ordinary Shares
   75
    Table of Contents  Taxation of Disposition of ADSs or Ordinary Shares
  Passive Foreign Investment Company
  
    
    at least 75% of its gross income for such year is passive income; or
    
    at least 50% of the value of its assets (based on an average of the
quarterly values of the assets during a taxable year) is
attributable to assets that produce or are held for the production
of passive income.
   76
    Table of Contents  
    
    the excess distribution or gain will be allocated ratably
over your holding period for the ADSs or ordinary shares;
    
    the amount allocated to the current taxable year, and any
taxable year prior to the first taxable year in which we
became a PFIC, will be treated as ordinary income; and
    
    the amount allocated to each other year will be subject to
the highest tax rate in effect for that year and the
interest charge generally applicable to underpayments of
tax will be imposed on the resulting tax attributable to
each such year.
     77
    Table of Contents  Information Reporting and Backup Withholding
   Recent Legislative Developments
  F. Dividends and Paying Agents
  G. Statement by Experts
  H. Documents on Display
   78
    Table of Contents  I. Subsidiary Information
  
 ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
 Foreign Exchange Risk
   Commodity Price Risk
  79
    Table of Contents  Interest Rate Risk
  
 ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
 A. Debt Securities
  B. Warrants and Rights
  C. Other Securities
  D. American Depositary Shares
 Fees and Charges Payable to the Depositary
  Service
    
    Fees   Issuance or distribution of ADSs, including
distributions made pursuant to stock dividends or
other free distributions of stock, bonus
distributions, stock splits or other distributions
(except where converted to cash)
    
    Up to $0.05 per ADS issued   Surrender of ADSs for cancellation and
withdrawal of deposited securities, including cash
distributions made pursuant to a cancellation or
withdrawal
    
    Up to $0.05 per ADS surrendered   Distribution of cash proceeds, including cash
dividends or sale of rights and other entitlements
(not made pursuant to a cancellation or withdrawal)
    
    Up to $0.05 per ADS held   Distribution of ADSs upon the exercise of rights
    
    Up to $0.05 per ADS issued   Operation and maintenance costs in
administering the ADSs
    
    Up to $0.05 per ADS held, such
fee to be assessed against
holders of record on an annual
basis as of the date or dates
set by the depositary as it
sees fit and collected at the
sole discretion of the
depositary by billing such
holders for such fee or by
deducting such fee from one or
more cash dividends or other
cash distributions
 80
    Table of Contents  
    
    taxes (including applicable interest and penalties) and other governmental charges;
    
    such registration fees as may from time to time be in effect for the registration of our
ordinary shares or other deposited securities on the share register and applicable to
transfers of our ordinary shares or other deposited securities to or from the name of the
custodian, the depositary or any nominees upon the making of deposits and withdrawals,
respectively;
    
    such cable, telex, facsimile and electronic transmission and delivery expenses as are
expressly provided in the deposit agreement to be at the expense of the person depositing
or withdrawing our ordinary shares or the holders and beneficial owners of our ADSs;
    
    the expenses and charges incurred by the depositary in the conversion of foreign currency;
    
    such fees and expenses as are incurred by the depositary in connection with compliance
with exchange control regulations and other regulatory requirements applicable to our
ordinary shares, the deposited securities, ADSs and ADRs;
    
    the fees and expenses incurred by the depositary in connection with the delivery of
deposited securities, including any fees of a central depository for securities in the
local market, where applicable; and
    
    any additional fees, charges, costs or expenses that may be incurred by the depositary
from time to time.
    Fees and Payments From the Depositary to Us
  81
    Table of Contents  PART II
 
 ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
  
 ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
        
 ITEM 15. CONTROLS AND PROCEDURES
 Disclosure Controls and Procedures
  Managements Annual Report on Internal Control Over Financial Reporting
  82
    Table of Contents  Changes in Internal Control Over Financial Reporting
  
 ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
  
 ITEM 16B. CODE OF ETHICS
  
 ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
  Year Ended December 31,2009
    
    2010(RMB)
    
    (RMB)
    
    ($)Audit fees(1)
    
    
    2,254
    
    
    
    924
    
    
    
    140Audit-related fees(2)
    
    
    211
    
    
    
    
    
    
    
    Tax fees(3)
    
    
    
    
    
    
    
    
    
    
    All other fees(4)
    
    
    
    
    
    
    
    
    
    
    
 
 (1)
    
    Audit fees means the aggregate fees billed in each of the fiscal years listed for
professional services rendered by our independent registered public accounting firm for the audit
of our annual financial statements that are normally provided in connection with statutory and
regulatory filings or engagements for those fiscal years.(2)
    
    Audit-related fees means the aggregate fees billed in each of the fiscal years listed for
assurance and related services by our independent registered public accounting firm that are
reasonably related to the performance of the audit or review of our financial statements and are
not reported under Audit fees. Services 83
    Table of Contents  comprising the fees disclosed under category of Audit-related fees involve principally the issue
of comfort letter, rendering of listing advice and other audit-related services for the years
ended December 31, 2008, 2009 and 2010.(3)
    
    Tax fees means the aggregate fees billed in each of the fiscal years listed for
professional services rendered by our independent registered public accounting firm for tax
compliance, tax advice, and tax planning.(4)
    
    All other fees means the aggregate fees billed in each of the fiscal years listed for
products and services provided by our independent registered public accounting firm, other than
the services reported in the other categories.  
 ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
  
 ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
  
 ITEM 16F. CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT
  
 ITEM 16G. CORPORATE GOVERNANCE
  
    
    The NYSE standards for domestic companies require that non-management directors meet at
regularly scheduled executive sessions without management. Our non-management directors
have not met in executive sessions without management, and there is no requirement under
the laws of the Cayman Islands that our non-management directors meet in executive
sessions.
  84
    Table of Contents  PART III
 
 ITEM 17. FINANCIAL STATEMENTS
  
 ITEM 18. FINANCIAL STATEMENTS
  
 ITEM 19. EXHIBITS
  Number
    
    Description of Document1.1*
    
    Form of Amended and Restated Memorandum and Articles of Association of China Xiniya
Fashion Limited2.1*
    
    Specimen Certificate for Ordinary Shares2.2*
    
    Form of Deposit Agreement, including form of American Depositary Receipts4.1*
    
    Form of 2010 Equity Incentive Plan4.2*
    
    Form of Employment Agreement between China Xiniya Fashion Limited and a Senior Executive
Officer of China Xiniya Fashion Limited4.3*
    
    English Translation of the Form of Franchise Provincial General Distributorship Contract4.4*
    
    English Translation of the Franchise Provincial General Distributorship Contract between
Fujian Xiniya Garments and Weaving Co., Ltd. and Hangzhou Beili Trading Co., Ltd. dated
November 27, 20094.5*
    
    English Translation of the Franchise Provincial General Distributorship Contract between
Fujian Xiniya Garments and Weaving Co., Ltd. and Fuzhou Xiangmao Trading Co., Ltd. dated
November 27, 20094.6*
    
    English Translation of the Franchise Provincial General Distributorship Contract between
Fujian Xiniya Garments and Weaving Co., Ltd. and Guangzhou Kunlun Shijia Garments Co., Ltd.
dated November 27, 20098.1*
    
    List of Subsidiaries of China Xiniya Fashion Limited11.1*
    
    Code of Business Conduct and Ethics of China Xiniya Fashion Limited12.1
    
    Certification of Chief Executive Officer required by Section 302 of the Sarbanes-Oxley Act
of 200212.2
    
    Certification of Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act
of 200213.1
    
    Certification of Chief Executive Officer required by 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 200213.2
    
    Certification of Chief Financial Officer required by 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 
 *
    
    Incorporated by reference to our Registration Statement on Form F-1 (File No. 333-170368)
filed with the Securities and Exchange Commission, as declared effective on November 22,
2010. 85
    Table of Contents  SIGNATURE
  CHINA XINIYA FASHION LIMITEDBy:
    /s/ Qiming XuName:
    Qiming XuTitle:
    Chairman and Chief Executive Officer  86
    Table of Contents  EXHIBIT INDEX
 ExhibitNumber
    
    Description of Exhibits12.1
    
    Certification of Chief Executive Officer required by
Section 302 of the Sarbanes-Oxley Act of 200212.2
    
    Certification of Chief Financial Officer required by
Section 302 of the Sarbanes-Oxley Act of 200213.1
    
    Certification of Chief Executive Officer required by
18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 200213.2
    
    Certification of Chief Financial Officer required by
18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
      CHINA XINIYA FASHION LIMITED
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
 PageReport of Independent Registered Public Accounting Firm
    
    
    F-2Consolidated Statements of Comprehensive Income for the years ended December 31, 2008, 2009, 2010
    
    
    F-3Consolidated Statements of Financial Position as at December 31, 2009 and 2010
    
    
    F-4Consolidated Statements of Changes in Equity for the years ended December 31, 2008, 2009 and 2010
    
    
    F-5Consolidated Statements of Cash Flows for the years ended December 31, 2008, 2009 and 2010
    
    
    F-6Notes to the Consolidated Financial Statements
    
    
    F-7
  F-1
    Table of Contents  REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
    
 F-2
    Table of Contents  CHINA XINIYA FASHION LIMITED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Expressed in Thousands of Chinese Renminbi Yuan, except share and per share amounts)
For the Years Ended December 31, 2008, 2009 and 2010
 Notes
    
    2008
    
    2009
    
    2010Revenue
    
    
    
    
    
    
    479,711
    
    
    
    672,075
    
    
    
    899,252Cost of sales
    
    
    
    
    
    
    (313,521
    )
    
    
    (438,773
    )
    
    
    (589,233
    )Gross profit
    
    
    
    
    
    
    166,190
    
    
    
    233,302
    
    
    
    310,019Interest income
    
    
    
    
    
    
    677
    
    
    
    793
    
    
    
    847Selling and distribution expenses
    
    
    
    
    
    
    (15,925
    )
    
    
    (8,744
    )
    
    
    (11,999
    )Administrative expenses
    
    
    
    
    
    
    (6,813
    )
    
    
    (2,898
    )
    
    
    (10,108
    )Profit before taxation
    
    
    4
    
    
    
    144,129
    
    
    
    222,453
    
    
    
    288,759Income tax expense
    
    
    5
    
    
    
    (18,112
    )
    
    
    (28,109
    )
    
    
    (36,413
    )Profit for the year
    
    
    
    
    
    
    126,017
    
    
    
    194,344
    
    
    
    252,346Earnings per share  basic and
diluted (in RMB)
    
    
    6
    
    
    
    0.63
    
    
    
    0.97
    
    
    
    1.24Weighted average shares
outstanding in the year
    
    
    6
    
    
    
    200,000,000
    
    
    
    200,000,000
    
    
    
    203,419,178
  F-3
    Table of Contents  CHINA XINIYA FASHION LIMITED
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Expressed in Thousands of Chinese Renminbi Yuan)
As at December 31, 2009 and 2010
 Notes
    
    2009
    
    2010AssetsNon-current assetsProperty, plant and equipment
    
    
    7
    
    
    
    2,776
    
    
    
    1,642Prepayments
    
    
    10
    
    
    
    
    
    
    
    5,018Total non-current assets
    
    
    
    
    
    
    2,776
    
    
    
    6,660Current assetsCash and cash equivalents
    
    
    
    
    
    
    142,302
    
    
    
    862,797Trade receivables
    
    
    8
    
    
    
    127,819
    
    
    
    221,356Inventories
    
    
    9
    
    
    
    11,018
    
    
    
    5,658Other receivables and prepayments
    
    
    10
    
    
    
    2,575
    
    
    
    5,054Total current assets
    
    
    
    
    
    
    283,714
    
    
    
    1,094,865Total assets
    
    
    
    
    
    
    286,490
    
    
    
    1,101,525Equity and liabilitiesEquityShare capital
    
    
    11
    
    
    
    9,843
    
    
    
    77Additional paid-in capital
    
    
    11
    
    
    
    
    
    
    
    529,650Statutory reserve
    
    
    12
    
    
    
    43,897
    
    
    
    69,351Retained earnings
    
    
    
    
    
    
    174,667
    
    
    
    403,754Total equity
    
    
    
    
    
    
    228,407
    
    
    
    1,002,832Current liabilitiesTrade payables
    
    
    
    
    
    
    28,017
    
    
    
    46,358Other payables and accruals
    
    
    13
    
    
    
    18,168
    
    
    
    38,378Current income tax payable
    
    
    
    
    
    
    11,898
    
    
    
    13,957Total current liabilities
    
    
    
    
    
    
    58,083
    
    
    
    98,693Total equity and liabilities
    
    
    
    
    
    
    286,490
    
    
    
    1,101,525
  F-4
    Table of Contents  CHINA XINIYA FASHION LIMITED
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(Expressed in Thousands of Chinese Renminbi Yuan)
For the Years Ended December 31, 2008, 2009 and 2010
 Attributable to the Companys Equity HoldersAdditionalShare
    
    paid-in
    
    Statutory
    
    Retained
    
    Totalcapital
    
    capital
    
    reserve
    
    earnings
    
    equityBalance at January 1, 2008
    
    
    9,843
    
    
    
    
    
    
    
    11,542
    
    
    
    
    
    
    
    21,385Profit for the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    126,017
    
    
    
    126,017Transfer to statutory reserve
    
    
    
    
    
    
    
    
    
    
    12,678
    
    
    
    (12,678
    )
    
    
    Balance at December 31, 2008
    
    
    9,843
    
    
    
    
    
    
    
    24,220
    
    
    
    113,339
    
    
    
    147,402Profit for the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    194,344
    
    
    
    194,344Transfer to statutory reserve
    
    
    
    
    
    
    
    
    
    
    19,677
    
    
    
    (19,677
    )
    
    
    Dividends paid (note 14)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (113,339
    )
    
    
    (113,339
    )Balance at December 31, 2009
    
    
    9,843
    
    
    
    
    
    
    
    43,897
    
    
    
    174,667
    
    
    
    228,407Reorganization
    
    
    (9,776
    )
    
    
    9,776
    
    
    
    
    
    
    
    
    
    
    
    Proceeds from shares issued
    
    
    10
    
    
    
    519,874
    
    
    
    
    
    
    
    
    
    
    
    519,884Profit for the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    252,346
    
    
    
    252,346Transfer to statutory reserve
    
    
    
    
    
    
    
    
    
    
    25,454
    
    
    
    (25,454
    )
    
    
    Share-based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,195
    
    
    
    2,195Balance at December 31, 2010
    
    
    77
    
    
    
    529,650
    
    
    
    69,351
    
    
    
    403,754
    
    
    
    1,002,832
  F-5
    Table of Contents  CHINA XINIYA FASHION LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Expressed in Thousands of Chinese Renminbi Yuan)
For the Years Ended December 31, 2008, 2009 and 2010
 2008
    
    2009
    
    2010Cash flows from operating activities:Profit before taxation
    
    
    144,129
    
    
    
    222,453
    
    
    
    288,759Adjustments for:Depreciation for property, plant and equipment
    
    
    517
    
    
    
    518
    
    
    
    389Loss on disposal of property, plant and equipment
    
    
    
    
    
    
    
    
    
    
    351Share-based compensation
    
    
    
    
    
    
    
    
    
    
    2,195Operating profit before working capital changes
    
    
    144,646
    
    
    
    222,971
    
    
    
    291,694Increase in trade receivable
    
    
    (50,657
    )
    
    
    (77,162
    )
    
    
    (93,537
    )(Increase)/decrease in inventories
    
    
    (2,805
    )
    
    
    (7,524
    )
    
    
    5,360(Increase)/decrease in other receivables and prepayments
    
    
    (4,244
    )
    
    
    4,506
    
    
    
    (8,400
    )Increase/(decrease) in trade payables
    
    
    32,778
    
    
    
    (15,743
    )
    
    
    18,341Increase/(decrease) in other payables and accruals
    
    
    9,111
    
    
    
    (3,821
    )
    
    
    12,472Cash generated by operating activities
    
    
    128,829
    
    
    
    123,227
    
    
    
    225,930Income tax paid
    
    
    (10,865
    )
    
    
    (23,458
    )
    
    
    (34,354
    )Net cash generated by operating activities
    
    
    117,964
    
    
    
    99,769
    
    
    
    191,576Cash flows from investing activities:Proceeds from the disposal of property, plant and equipment
    
    
    
    
    
    
    
    
    
    
    396Acquisition of property, plant and equipment
    
    
    
    
    
    
    
    
    
    
    (2
    )Net cash generated by investing activities
    
    
    
    
    
    
    
    
    
    
    394Cash flows from financing activities:Proceeds from share issued, net
    
    
    
    
    
    
    
    
    
    
    519,884Dividends paid
    
    
    (62,298
    )
    
    
    (113,339
    )
    
    
    Increase/(decrease) in advance to and from director
    
    
    917
    
    
    
    (767
    )
    
    
    8,641Net cash (used in)/generated by financing activities
    
    
    (61,381
    )
    
    
    (114,106
    )
    
    
    528,525Net increase/(decrease) in cash and cash equivalents
    
    
    56,583
    
    
    
    (14,337
    )
    
    
    720,495Cash and cash equivalents at beginning of the year
    
    
    100,056
    
    
    
    156,639
    
    
    
    142,302Cash and cash equivalents at end of the year
    
    
    156,639
    
    
    
    142,302
    
    
    
    862,797
  F-6
    Table of Contents  CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 1. Organization and principal activities
        F-7
    Table of Contents   CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 2. Summary of significant accounting policies
         F-8
    Table of Contents   CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 2. Summary of significant accounting policies (continued)
        (a)
    
    assets and liabilities for each statement of financial position presented are
translated at the closing rate at the date of that statement of financial position;(b)
    
    income and expenses for each income statement are translated at average
exchange rates (unless this average is not a reasonable approximation of the cumulative
effect of the rates prevailing on the transaction dates, in which case income and
expenses are translated at the rate on the dates of the transactions); and(c)
    
    all resulting exchange differences are recognized in other comprehensive
income.
    Plant and machinery
    
    5-10 yearsFurniture, fixtures and office equipment
    
    5-10 years
   F-9
    Table of Contents   CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 2. Summary of significant accounting policies (continued)
              F-10
    Table of Contents   CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 2. Summary of significant accounting policies (continued)
             F-11
    Table of Contents   CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 2. Summary of significant accounting policies (continued)
               F-12
    Table of Contents   CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
        F-13
    Table of Contents   CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 2. Summary of significant accounting policies (continued)
    
    
    Where the VAT incurred on a purchase of assets or services is not recoverable from the
taxation authority, in which case the VAT is recognized as part of the cost of acquisition of
the asset or as part of the expense item as applicable; and
    
    Receivables and payables are stated with VAT included.
       F-14
    Table of Contents   CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 2. Summary of significant accounting policies (continued)
 Recently issued IFRSs
         3. Critical accounting estimates
       F-15
    Table of Contents   CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 3. Critical accounting estimates (continued)
   4. Profit before taxation
  Year Ended December 31,2008
    
    2009
    
    2010RMB000
    
    RMB000
    
    RMB000After charging:Cost of sales
    
    
    313,521
    
    
    
    438,773
    
    
    
    589,233Raw material consumed
    
    
    80,739
    
    
    
    85,543
    
    
    
    16,230Research and development expenses
    
    
    8,260
    
    
    
    9,293
    
    
    
    8,588Depreciation*
    
    
    517
    
    
    
    518
    
    
    
    389Freight expenses
    
    
    2,159
    
    
    
    3,268
    
    
    
    5,156Advertising and promotion
    
    
    11,409
    
    
    
    4,505
    
    
    
    3,948Directors- salaries and related costs
    
    
    
    
    
    
    
    
    
    
    112- social benefits contribution
    
    
    
    
    
    
    
    
    
    
    3- share-based compensation
    
    
    
    
    
    
    
    
    
    
    2,106Key management personnel (other than directors)- salaries and related costs
    
    
    531
    
    
    
    694
    
    
    
    928- social benefits contribution
    
    
    29
    
    
    
    43
    
    
    
    19- share-based compensation
    
    
    
    
    
    
    
    
    
    
    89Other than directors and key management personnel- salaries and related costs
    
    
    18,146
    
    
    
    21,557
    
    
    
    7,896- social benefits contribution
    
    
    1,546
    
    
    
    1,851
    
    
    
    651
 
 *
    
    Depreciation expenses of approximately RMB 416,000, RMB 416,000 and RMB 333,000 have
been included in cost of sales for the years ended December 31, 2008, 2009 and 2010, respectively. F-16
    Table of Contents  CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 5. Income tax expense
    Year Ended December 31,2008
    
    2009
    
    2010RMB000
    
    RMB000
    
    RMB000Profit before taxation
    
    
    144,129
    
    
    
    222,453
    
    
    
    288,759Computed expected income tax expense
    
    
    36,032
    
    
    
    55,613
    
    
    
    72,190Tax exemption
    
    
    (18,112
    )
    
    
    (28,109
    )
    
    
    (36,413
    )Others
    
    
    192
    
    
    
    605
    
    
    
    636Income tax expense
    
    
    18,112
    
    
    
    28,109
    
    
    
    36,413
 6 Earnings per share
    F-17
    Table of Contents  CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 7. Property, plant and equipment
 Furniture,fixtures andPlant and
    
    officemachinery
    
    equipment
    
    TotalRMB000
    
    RMB000
    
    RMB000CostAt January 1, 2009
    
    
    4,358
    
    
    
    545
    
    
    
    4,903Additions
    
    
    
    
    
    
    
    
    
    
    At December 31, 2009
    
    
    4,358
    
    
    
    545
    
    
    
    4,903Additions
    
    
    
    
    
    
    2
    
    
    
    2Disposals
    
    
    (1,185
    )
    
    
    (60
    )
    
    
    (1,245
    )At December 31, 2010
    
    
    3,173
    
    
    
    487
    
    
    
    3,660Accumulated depreciationAt January 1, 2009
    
    
    1,287
    
    
    
    322
    
    
    
    1,609Charge for the year
    
    
    415
    
    
    
    103
    
    
    
    518At December 31, 2009
    
    
    1,702
    
    
    
    425
    
    
    
    2,127Charge for the year
    
    
    310
    
    
    
    79
    
    
    
    389Disposals
    
    
    (454
    )
    
    
    (44
    )
    
    
    (498
    )At December 31, 2010
    
    
    1,558
    
    
    
    460
    
    
    
    2,018Net Book ValueAt December 31, 2009
    
    
    2,656
    
    
    
    120
    
    
    
    2,776At December 31, 2010
    
    
    1,615
    
    
    
    27
    
    
    
    1,642
  8. Trade receivables
  2009
    
    2010RMB000
    
    RMB000- within 30 days
    
    
    52,901
    
    
    
    88,843- 31 to 60 days
    
    
    60,498
    
    
    
    95,373- 61 to 90 days
    
    
    14,420
    
    
    
    37,140127,819
    
    
    
    221,356
  9. Inventories
 2009
    
    2010RMB000
    
    RMB000Raw materials
    
    
    310
    
    
    
    572Work in progress
    
    
    2,026
    
    
    
    432Finished goods
    
    
    8,682
    
    
    
    4,65411,018
    
    
    
    5,658
  F-18
    Table of Contents  CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 10. Other receivables and prepayments
 As at December 31,2009
    
    2010RMB000
    
    RMB000Prepayments
    
    
    1,672
    
    
    
    5,054Amount owed by a director
    
    
    903
    
    
    
    2,575
    
    
    
    5,054
   11. Share capital and additional paid-in capital
    AdditionalNumber of
    
    Ordinary
    
    paid-inshares
    
    shares
    
    capital
    
    Total(thousands)
    
    RMB000
    
    RMB000
    
    RMB000At June 24, 2010
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Proceeds from shares issued
    
    
    232,000
    
    
    
    77
    
    
    
    529,650
    
    
    
    529,727At December 31, 2010
    
    
    232,000
    
    
    
    77
    
    
    
    529,650
    
    
    
    529,727
  12. Statutory reserve
  F-19
    Table of Contents  CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 13. Other payables and accruals
 As at December 31,2009
    
    2010RMB000
    
    RMB000Provision for withholding tax
    
    
    1,140
    
    
    
    1,527VAT payable
    
    
    3,559
    
    
    
    6,380Deposits received from distributors
    
    
    5,000
    
    
    
    5,200Accrued liabilities
    
    
    8,469
    
    
    
    17,533Payable to directors
    
    
    
    
    
    
    7,73818,168
    
    
    
    38,378
    14. Dividends
  15. Commitments
 Operating leases commitments
  As at December 312010RMB000Less than one year
    
    
    984Between one and five years
    
    
    3,9364,920
  Purchase commitments
  F-20
    Table of Contents  CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 16. Financial Risk Management ObjectivesPolicies
               F-21
    Table of Contents  CHINA XINIYA FASHION LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 17. Capital management
      18. Related parties transactions
  Year Ended December 31,2008
    
    2009
    
    2010RMB000
    
    RMB000
    
    RMB000Factory rental paid to a related party
    
    
    984
    
    
    
    984
    
    
    
    984Royalty fees for use of trademark
    
    
    3,190
    
    
    
    
    
    
    
    
     19. Subsequent Events
  F-22